Harriston. K TO: Proximity Social Networking Team FROM: Kendra Harriston DATE: Feb 21, 2010 SUBJECT: Twitter Strategy Analysis
Here is my strategy analysis for the microblogging website, Twitter. Gen Y users have adopted Twitter as one of their
primary sources for finding out what is currently going on, whether it be about their friends or some event occurring in real time. Profile
Twitter was started back in 2006 when creator, Jack Dorsey, came up with an idea for a “short message service (SMS)” in order
to communicate with a small group of people. (Wikipedia 2010). The original name of the site was “twttr,” which was influenced
by the name of the yahoo based photo website, “Flickr.” After the first prototype of Twitter was used as an internal messaging
service for employees of Odeo, a website for RSS syndicated video and audio, members of Odeo formed “Obvious Corporation”
and took over Odeo and all of its assets, including Twitter.
In April 2007, Twitter branched off as its own company. As it is now
users use the site to post messages, thoughts, etc, that are under 140 characters, to fellow “followers.” Because Twitter is a
free service, obvious it is not making any money, except for the funding it has received from venture capitalists firms, such
as Benchmark Capital. Twitter’s various investors include:
Spark Capital
Insight Ventire Partners
Square Ventures
Union Square Ventures
Bezos Expeditions
Digital Garage
Today, Twitter has about over 14 million people using the site (Ostrow, 2009). Even though the site makes no from from
its users, it is estimated that Twitter will earn about $1.54 billion in revenue, about 1 billion users, 5,200 employees, and
$111 million in net earnings. (New York Times, 2009)
Competitive Landscape Although Twitter is the only microblogging website of its kind, the question is: can Twitter become more than just a current
fad? Sure, most users on the site follow the messages posted by their favorite celebrities, but how long are these users going
to be following celebrities, or sending mini messages and posts to their friends and other members. The longevity of this
company is going to solely depend on the fickleness of users.
Twitter’s Strategy As said before, users on Twitter can send “tweets” to their fellow “followers” about things going on in their daily lives, such as
what they’re currently doing; pretty much you can say whatever you want to say. The only restriction is that your message can only
be max of 140 characters (About Twitter, 2010). This limit stems from the limit on the amount of characters in a typical cell phone
text message (between 140-160 characters.) Due to the popularity of Twitter, have applications have been created to further
expand Twitter accessibility. One application called “Twitpic” allows users to upload a picture (from a computer or cell phone)
and post though via a “tweet.” Other applications include: “Ubertwitter,” “Hootsuite,” “Tweetdeck,” “Echophone,” and “Twitvid.”
Gen-Y Implications Twitter may be one of the most popular sites in the social networking arena, but how is company going to last if it is not
making any money? One suggestion is possibly charging users who have the most user traffic on the site, notably the
celebrities, like Ashton Kutcher, and businesses like Best Buy, or even CNN. The thing is, in the long run, if a business
decided to create a Twitter page, would paying for a page even benefit them?
TO: Proximity Social Networking Team
FROM: Kendra Harriston
DATE: Feb 21, 2010
SUBJECT: Twitter Strategy Analysis
Here is my strategy analysis for the microblogging website, Twitter. Gen Y users have adopted Twitter as one of their
primary sources for finding out what is currently going on, whether it be about their friends or some event occurring in real time.
Profile
Twitter was started back in 2006 when creator, Jack Dorsey, came up with an idea for a “short message service (SMS)” in order
to communicate with a small group of people. (Wikipedia 2010). The original name of the site was “twttr,” which was influenced
by the name of the yahoo based photo website, “Flickr.” After the first prototype of Twitter was used as an internal messaging
service for employees of Odeo, a website for RSS syndicated video and audio, members of Odeo formed “Obvious Corporation”
and took over Odeo and all of its assets, including Twitter.
In April 2007, Twitter branched off as its own company. As it is now
users use the site to post messages, thoughts, etc, that are under 140 characters, to fellow “followers.” Because Twitter is a
free service, obvious it is not making any money, except for the funding it has received from venture capitalists firms, such
as Benchmark Capital. Twitter’s various investors include:
Spark Capital
Insight Ventire Partners
Square Ventures
Union Square Ventures
Bezos Expeditions
Digital Garage
Today, Twitter has about over 14 million people using the site (Ostrow, 2009). Even though the site makes no from from
its users, it is estimated that Twitter will earn about $1.54 billion in revenue, about 1 billion users, 5,200 employees, and
$111 million in net earnings. (New York Times, 2009)
Competitive Landscape
Although Twitter is the only microblogging website of its kind, the question is: can Twitter become more than just a current
fad? Sure, most users on the site follow the messages posted by their favorite celebrities, but how long are these users going
to be following celebrities, or sending mini messages and posts to their friends and other members. The longevity of this
company is going to solely depend on the fickleness of users.
Twitter’s Strategy
As said before, users on Twitter can send “tweets” to their fellow “followers” about things going on in their daily lives, such as
what they’re currently doing; pretty much you can say whatever you want to say. The only restriction is that your message can only
be max of 140 characters (About Twitter, 2010). This limit stems from the limit on the amount of characters in a typical cell phone
text message (between 140-160 characters.) Due to the popularity of Twitter, have applications have been created to further
expand Twitter accessibility. One application called “Twitpic” allows users to upload a picture (from a computer or cell phone)
and post though via a “tweet.” Other applications include: “Ubertwitter,” “Hootsuite,” “Tweetdeck,” “Echophone,” and “Twitvid.”
Gen-Y Implications
Twitter may be one of the most popular sites in the social networking arena, but how is company going to last if it is not
making any money? One suggestion is possibly charging users who have the most user traffic on the site, notably the
celebrities, like Ashton Kutcher, and businesses like Best Buy, or even CNN. The thing is, in the long run, if a business
decided to create a Twitter page, would paying for a page even benefit them?
References:
Twitter. (2009, November). Retrieved from http://en.wikipedia.org/wiki/Twitter
About Twitter. (2010). Retrieved from http://twitter.com/about
Ostrow, Adam. (2009). How many People actually use twitter?. Retrieved from http://mashable.com/2009/04/28/twitter-active-users/
Miller, Claire Cain, & Stone, Brad. (2009, July 15). Hacker exposes private twitter documents. The New York Times,